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Government chided for neglecting to meet mandatory small-business contracts

by | Mar 6, 2007 | ASBL News

News

Government chided for neglecting to meet mandatory small-business contracts

By Melissa Frederick
The Examiner
March 6, 2007

WASHINGTON - New statistics indicate the federal government is not meeting legal requirements to award 23 percent of federal contract work to small businesses.

 

Eagle Eye Inc., a Fairfax-based research firm that focuses on the federal government, compiled statistics this week showing the government has awarded only an average of 19 percent of its contracts to small firms.

“It generally confirms the general trend we’ve seen in the last several years, that it is just getting more and more difficult for small businesses to compete and for agencies to meet their ... overall goal,” Paul Murphy, president of Eagle Eye Inc., said Monday.

The figures were met with outrage by Lloyd Chapman, president of the American Small Business League advocacy group.

“There’s a culture in government that is, ‘How can we get around hiring small businesses?’” Chapman said Monday. “They’ll pass policies, legislation, anything they can, because small businesses have little or no clout with the government, and defense contractors have more than anybody in the world.”

Christine Mangi, press secretary of the U.S. Small Business Administration, the agency charged with promoting small businesses to the government, said Monday she could not respond to questions about the statistics by deadline.

Chapman said the numbers may be even lower than what Eagle Eye Inc. found.

His group has accused the SBA of not doing enough to make sure that companies registered as small businesses actually meet the criteria, a concern echoed by the inspector general governing the SBA.

Chapman is also concerned about the issue of federal contractors purchasing small businesses as soon as they receive a significant award, he said.

The SBA, though, is implementing a new rule that would require companies to recertify that they meet small-business criteria every five years, though the rule does not take effect until 2012.

The agency also is planning to review existing small-business contracting information and make it public, as well as implementing a small-business report card that scores federal agencies on their progress in meeting small business goals, SBA administrator Steven Preston said in a February speech at the National Press Club.

melissa.frederick@dcexaminer.com

© 2007 The Examiner All rights reserved.

Bush Administration Fails Small Businesses Once Again

by | Mar 5, 2007 | Press Release

Press Release

Bush Administration Fails Small Businesses Once Again

Latest statistics show government fails to meet small business goals for seventh year

March 5, 2007

Petaluma, Calif.- According to a recent report by Eagle Eye Publishing, a commercial provider of federal procurement information, the federal government has failed to achieve the federally mandated 23 percent small business contracting goal for the seventh consecutive year. 
 
Eagle eye statistics found that the government reached a mere 19 percent once again in 2006. However, Lloyd Chapman, small business advocate and president of the American Small Business League, estimates that the actual number is significantly lower considering many of the top recipients were Fortune 1000 companies or subsidiaries. Last year’s statistics cited L-3 Communications as the top recipient in small business contracts totaling $650 million. 
 
“The numbers that Eagle Eye Publishers reported includes contracts awarded to major corporations like Boeing, Lockheed, Microsoft and Bechtel—some of the largest firms in the US and dozens in Europe,” Chapman said. “If you exclude the Fortune 1000 firms on the list, the government is probably only reaching 5 percent of small businesses.”
 
Since 2002, 14 federal investigations have found billions of dollars have been diverted from legitimate small businesses to Fortune 1000 companies and subsidiaries across the country. Even though this issue was first exposed in 2002, Congress has passed no legislation to stop it. In November 2006, Steven Preston, head of the Small Business Administration, proposed a policy that will actually allow the government to continue to count awards to large companies toward its small business goals until 2012.
 
On Dec. 16, 2006, the government abruptly pulled employee and revenue statistics off of the government’s Central Contracting Registry, information that allows the public to determine a company’s small business size status. Chapman says he believes this is another government attempt to keep Congress, the public, and the media from being able to prove that federal agencies have completely falsified their small business numbers for several years.